On February 25, 2021, the Canadian Securities Administrators (CSA), referring to amendments to certain securities rules affecting the prospectus and registration exemptions for syndicated mortgages that were published on August 6, 2020 (Syndicated Mortgage Amendments), reported in a notice that the Syndicated Mortgage Amendments would come into effect on March 1, 2021 in most provinces and territories in Canada. The Syndicated Mortgage Amendments include changes to certain prospectus and registration exemptions available for the distribution of syndicated mortgages, including the following:

  • removing the prospectus and registration exemptions under sections 2.36 of NI 45-106 and 8.12 of NI 31-103 (the Mortgage Exemptions) respectively for the distribution of syndicated mortgages in Newfoundland and Labrador, the Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island and Yukon; [1]
  • introducing additional requirements to the offering memorandum prospectus exemption under section 2.9 of NI 45-106 (the OM Exemption) that will apply when the exemption is used to distribute syndicated mortgages; and
  • amending the private issuer prospectus exemption under section 2.4 of NI 45-106 (the Private Issuer Exemption) so that it is not available for the distribution of syndicated mortgages.

The Syndicated Mortgage Amendments will take effect in all jurisdictions on March 1, 2021, except in Ontario and Québec.

In Ontario, the Syndicated Mortgage Amendments will become effective on the later of:

  • March 1, 2021; and
  • the day on which sections 4 and 5 of Schedule 37 to Bill 177, Stronger, Fairer Ontario Act (Budget Measures), 2017 are proclaimed into force.

The proclamation, and therefore the effective date in Ontario, is expected to be July 1, 2021.

In Québec, subject to requisite approvals, the Amendments are expected to take effect on July 1, 2021, at the earliest. A local notice confirming the exact effective date will be published, when determined.

For a full copy of the notice: https://www.bcsc.bc.ca/-/media/PWS/New-Resources/Securities-Law/Instruments-and-Policies/Policy-4/45328-CSA-Staff-Notice-February-25-2021.pdf

For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606.

This publication is not intended to constitute legal advice. No one should act on it or refrain from acting on it without consulting with a lawyer. BAX does not warrant or guarantee the accuracy or currency or completeness of the publication. No part of this publication may be reproduced without the prior written permission of BAX Securities Law.

[1] Syndicated mortgages are already excluded from the Mortgage Exemptions in Alberta, British Columbia, Manitoba, New Brunswick, Québec and Saskatchewan